As long as economies of scale apply, mining will centralize, regardless of blocksize. Bigger miners can push out smaller ones.
As far as full nodes go, incentives are a big problem IMO: there's no direct profit in running one, so whoever runs a full node is either a hobbyist/altruist, or needs one to run a business. I don't really see what kind of user needs a full node yet is unable to pay for one, if Bitcoin is more of a high-value settlement network than a high-throughput payment network.
The point is, while blocksize has some effect on centralization I don't think it's all that big a factor in the end.
I'm not sure what you mean with your last point - that the code that gets used is always made by the developers best equipped to set economic policy? Because that is what decisions on blocksize are.
What's the point of Bitcoin if that's just a high-value settlement network?
From the perspective of end users, all the Bitcoin advantages materialize only if they use it directly as a payment network; otherwise they are de-facto using something else and it doesn't really matter how that something else is settled in the background, it matters how that something else works and if it works differently than Bitcoin, they're using that and not really Bitcoin.
From the perspective of users (organizations) who need high-value settlement networks, the classic alternatives (e.g. Target2) are better than Bitcoin since the needs are quite different, and the advantages of cryptocurrencies aren't that useful for high-value settlement, they matter mostly for end users.
> Because that is what decisions on blocksize are.
I disagree, blocksize is only related to decentralization/throughput trade-offs, not economic policy. The only economic policy that bitcoin has is the inflation rate, which is set in stone and very unlikely to ever change.
I can't really agree here. Blocksize sets a max cap on transaction rate, which is effectively a decision that the network should prefer high-value, low-frequency transactions, even though from a miner profitability (and therefore hashrate-security) standpoint, the opposite might be better. Might also be that a settlement network is the best use case for Bitcoin, but we don't know what the market would prefer because the scales are tipped in favour of high-value tx by people who believe they know best.
As far as full nodes go, incentives are a big problem IMO: there's no direct profit in running one, so whoever runs a full node is either a hobbyist/altruist, or needs one to run a business. I don't really see what kind of user needs a full node yet is unable to pay for one, if Bitcoin is more of a high-value settlement network than a high-throughput payment network.
The point is, while blocksize has some effect on centralization I don't think it's all that big a factor in the end.
I'm not sure what you mean with your last point - that the code that gets used is always made by the developers best equipped to set economic policy? Because that is what decisions on blocksize are.